Q: My husband and I have been retired for several years and are realizing that we might just outlive our expectations.
Even if it's a blessing to be able to spend all these years together, our finances are less clear. When planning our retirement, we budgeted for a comfortable life into our early 80s. Unluckily for us, we've both turned out to be very healthy!
What are your top recommendations for stretching a budget?
A: Being on a restricted budget gives us a new urge to be cost-efficient, but it's hard to know where to start.
When seniors find themselves living on a fixed income, many often find out that they're less financially literate than they'd assumed.
To figure out how to manage your budget, find out where you spend your money.
Gather your receipts in one place and plot out your financial transactions over time. Even doing this on a relatively small scale -- a month or so -- should reveal your spending patterns.
Figure out what your biggest expense categories are, which may include transportation, food, entertainment, maintenance, debt, medical, utilities, housing or others. Also write down any sources of income you receive, such as Social Security or rent from tenants.
Once you know where the money goes, decide which categories to prioritize.
You'll realize that some expenses are more flexible than others: Food and entertainment are particularly variable. In the short term, those are the categories you should target.